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Selected data from the financial statements of KRJ Manufacturing are presented below. Calculate the return on...

Selected data from the financial statements of KRJ Manufacturing are presented below. Calculate the return on assets for the year, presenting your answer in percentage terms, rounded to two decimal places. e.g. 20.00%.

Sales $117,358

Gross profits $51,639

Operating profits (EBIT) $32,879

Earnings before taxes (EBT) $25,389

Net profits $24,739

Tax expense 8,000

Depreciation expense $13,207

Total assets, beg of year $80,302

Total assets, end of year $99,082

Total equity, beg of year $46,237

Total equity, end of year $53,675

Cash flow from operations $33,870

Solutions

Expert Solution

Answer:

Average Total Assets = (Beginning Total Assets + Ending Total Assets)/2
Average Total Assets = ($80,302 + $99,082)/2
Average Total Assets = $89,692

Return on Assets = Net Profit / Average Total Assets *100
Return on Assets = $24,739 / $89,692 *100
Return on Assets = 27.58%

jeff jeffy answered 2 years ago
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